Capital Structure and Firm Performance in Nigeria

This study analysed how the capital structure of Nigerian Exchange Group-listed industrial companies affected their financial results. Capital structure was estimated using data on long-term debt to short-term debt ratios, and company performance was estimated using return on assets. Thirty-one (31) manufacturing companies were surveyed between 2012 and 2021, and the analytical approach consisted of descriptive and inferential statistics. The study's findings indicated that the ratio of short-term to long-term debt had a substantial, beneficial effect on the performance of manufacturing companies. Findings suggest that manufacturing company management should improve short- and long-term debt ratios by making the best use of available resources to increase the company's value for its shareholders. In addition, industrial companies should finance their capital structure using short-term obligations rather than long-term debts.